MDU
MDU Resources Group, Inc.
$19.57
Stable Earnings Power
85%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 44.2% below fair value
You pay
$19.57
Bear
$30.66
Fair
$35.04
Bull
$39.42
Bear
$30.66
+56.7%
$1.81 × 17x P/E
Fair
$35.04
+79.1%
$1.81 × 19x P/E
Bull
$39.42
+101.4%
$1.81 × 22x P/E
Adjust Assumptions
19.4x
1.81$
Key Value Driver
Normalized P/E multiple (19x base case)
Implied Market Multiple
10.8x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (19 analysts)
$25.00
Divergence from AlphaVal
40%
Summary
Applying a 19x P/E to adjusted EPS of $1.81, the base-case value is $35.04 per share.
Warnings
The company's reported profits differ from official accounting profits by 95%. Check what costs are being left out of the adjusted number.
Wall Street's average price target is $25.00 (from 19 analysts). Our estimate is 40% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples